CME to sue CFTC over approval of Bitcoin perpetual futures

CME Group plans to take the Commodity Futures Trading Commission to court over its approval of Bitcoin perpetual futures, escalating a fight that could shape how one of crypto’s fastest-growing derivatives is regulated in the US.

Terry Duffy, CME’s chief executive, said on CNBC’s Fast Money on June 17 that the Chicago exchange operator will file suit on June 19. His argument is blunt: perpetual futures should not be treated as futures at all. Under his reading of the Dodd-Frank Act, they belong in the swaps bucket, a classification that would pull them under a different regulatory and trading framework.

The dispute matters because the CFTC’s approval of Kalshi’s Bitcoin perpetual futures product in May was the first of its kind in the US. Kalshi has since broadened the offering to other cryptocurrencies, putting a new kind of leveraged crypto exposure into a regulated venue with no expiry date. That structure has long been popular offshore, where traders can hold positions indefinitely so long as they can meet margin requirements.

Duffy also pointed to CME’s licensing relationships with benchmark providers, arguing that if perpetual contracts are classified as swaps, they would ultimately have to be listed through CME’s system. That would give the exchange a powerful gatekeeping role over how such products are brought to market, even as newer platforms push to expand access outside the traditional futures complex.

The lawsuit opens a fresh front between the CFTC and incumbent derivatives players at a moment when the regulator’s stance is shifting. CFTC Chairman Michael Selig recently said on the same program that regulated futures without expiration dates should be allowed in the US under proper oversight. That comment suggests the agency is more open to the product than CME is willing to accept, and it sets up a legal test over where perpetuals fit in federal law.

Duffy, who is due to step down in March next year, said he has been raising the issue with CME’s board for eight months and is ready to fight. Traders will be watching the June 19 filing for the exact legal theory, the venue chosen and whether the case tries to block further expansion of perpetual crypto contracts while the court battle plays out.